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August 27, 2019 | The Unsustainable Cost of Unaffordable Housing

Danielle Park

Portfolio Manager and President of Venable Park Investment Counsel (www.venablepark.com) Ms Park is a financial analyst, attorney, finance author and regular guest on North American media. She is also the author of the best-selling myth-busting book "Juggling Dynamite: An insider's wisdom on money management, markets and wealth that lasts," and a popular daily financial blog: www.jugglingdynamite.com

Food banks started in the late 1960’s as a stop-gap charity to help poor people make ends meet and get through periods of unemployment.  As wage gains stagnated over the last 30 years, debt levels rose and food bank use by working people has steadily climbed in many countries including North America–especially since the 2008 recession.  Now the debt-inflated cost of shelter means a growing number of working people are unable to feed their families while paying their mortgage.

Hoping to curb rising defaults, major banks in Australia recently approached Foodbank South Australia wanting to refer customers in need of food to the charity, in the hope it will prevent more of them from falling behind on their mortgage payments. This is an unsustainable system.  Lower shelter prices, less household debt and higher income levels are all part of the solutions needed. See Banks are now referring people to Foodbank to help them pay their mortgage:

It comes as a new report has shown mental distress is increasing in older Australians, with nearly half of all homeowners aged 55 to 64 still paying off a mortgage — up from just 14 per cent 30 years ago.

Foodbank South Australia is now working on a new agreement which would enable clients to access its food services directly, with a voucher funded by the major bank.

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August 27th, 2019

Posted In: Juggling Dynamite

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